Canada has the second largest franchise industry in the world, second only to the United States.  The hospitality industry (e.g. fast food and other restaurants) and retail industry account for the majority of franchises.  With the rapid growth of franchising in Canada over the past years, there has been an increase in franchising disputes.  Licensing agreements give permission to a licensee to use the brand, patent or trademark of another party.  Such agreements are prevalent in the technology and pharmaceutical industries, among others.  Disputes often arise between the licensor and licensee due to an alleged breach of the agreement by one of the parties.

CHS has significant experience as financial experts in franchising and licensing disputes, having been engaged by both franchisors/licensors and franchisee/licensees.  In one of our franchising cases, we quantified the franchisor’s lost profits due to the closure of a franchise location.  This included the quantification of lost royalties, franchise fees, gross margin on sale of products to franchisee, and rebates/allowances from suppliers.  One of our licensing dispute engagements involved the quantification of amounts due to the licensor pursuant to the license agreement, if any, upon the sale of the shares of licensee company.  This case also involved estimating the value of the licensed biotechnology to the licensee company.